At 8:30AM ET this morning, we’ll get Statistics Canada’s forecasts for this year’s Canadian crop, and despite the inclement harvest weather that Mother Natures provided in 2016, it’s expected to be quite large. According to a Reuters survey of 13 analysts & traders, the StatsCan report is expected to show a 30.7M-tonne total wheat crop (would be +11% year-over-year), including 7.2M tonnes of durum (+34% YoY). Total oats production is guesstimated by the survey participants to reach 2.9M tonnes (-15% YoY) while the barley crop should hit 8.7M tonnes (+6%), and corn production should come in at 13.1M tonnes (-3% YoY). The biggest surprise could come from the oilseeds as soybean production is expected to come in at 6.2M tonnes (-2.5% YoY) whereas, somehow, 18.8M tonnes of canola was produced this year by Canadian farmers (+2.3% YoY). To round things out, Canadian peas production is set at a record 4.8M tonnes (+50% YoY) while Canadian lentil production is pegged at 3.3M tonnes (+30% YoY), also a record.

The Australian U.S.D.A., A.B.A.R.E.S. came out yesterday and announced a record winter crop in the Land Down Undaa of 52.4M tonnes of grain, a 32% jump year-over-year and 6M tonnes more than their September estimate! This includes record Aussie wheat production of 32.6M tonnes, up 4.5M tonnes from the September estimate and 35% higher than last year’s crop (previous record was 30M tonnes in 2011/12). Total oats production is expected to come in at 1.8M tonnes, a 38% jump over last year and 42% above the 5-year average, while barley production out off Australia is set to be a record of 10.6M tonnes, up 24% year-over-year, 1.1M tonnes from the September estimate, and 1M tonnes higher than the previous record 2 years ago. Finally, the Australian canola crop is now forecated to be the 3rd largest ever on record at 3.6M tonnes, up 22% year-over-year, while total chickpea production is expected to come in at 1.25M tonnes, a new record.

While it’s a banner year in Australia for grain production, the pace at which India is buying pulse crops is also one for the record books. As our friend Chuck Penner from Left Field Commodity Research points out, 570,000 MT of pulse crops have landed in India in the first 3 weeks of November, with Canada owning about 70%, which is less than usual. The reason being is places like the Black Sea, America, and Australia are getting their foot in the door as well, especially the latter as the huge chickpea crop in the Land Down Undaa will trigger more buyers to look south to Aussie options versus east to North America. While we continue to monitor any effects the removal of currency by the Indian government is having on farmers there, conditions for the rabi winter crop are relatively benign and acres are definitely higher year-over-year. As such, expecting the high prices we saw last winter and spring are likely unfounded, especially for yellow peas and small red lentils.

COMMODITY TRADING INVOLVES RISK AND MAY NOT BE SUITABLE FOR ALL RECIPIENTS OF THIS POST. Neither the information presented, nor any opinions expressed, constitutes a solicitation for the purchase or sale of any commodities. The thoughts expressed in this email and basic data from which they are derived are believed to be reliable, but cannot be guaranteed due to uncertainty about future events and complexities surrounding commodity markets. Those acting on the information are responsible for their own actions.

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About the Author

Brennan Turner

Brennan Turner is the CEO of FarmLead.com, North America’s Grain Marketplace.
He holds a degree in economics from Yale University and spent time on Wall Street in commodity trade and analysis before starting FarmLead.
In 2017, Brennan was named to Fast Company’s List of Most Creative People in Business and, in 2018, a Henry Crown Fellow.
He is originally from Foam Lake, Saskatchewan where his family started farming the land nearly 100 years ago (and still do to this day!).
Brennan's unique grain markets analysis can be found in everything from small-town print newspapers to large media outlets such as Bloomberg and Reuters.

Grain markets this morning are almost all green as U.S. grain prices are seeing the benefit from a weaker U.S. Dollar, but that’s also pushing other currencies higher, including the Canadian Loonie and Brazilian Real.